The Smart Grid Vision for Jodhpur Power Utility

7/31/2019 The Smart Grid Vision for Jodhpur Power Utility

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PA CONFIDENTIAL - Internal use only

THE SMART GRID VISION FOR

JODHPUR POWER UTILITYJodhpur

Rakesh Kumar Goyal

22nd April 2010


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PA Knowledge Limited 2010. Page 2PPT presentation template V1-10.pptPA CONFIDENTIAL - Internal use only

The Smart Grid is the future of the electric industry

The Smart Grid results from a convergence of powerful forces

Today, the Smart Grid is still a vision more than a blueprint

But infusing T&D networks with computing and telecommunications capabilities is theheart of the Smart Grid vision

Smart Grids could radically transform the way electricity is produced, transported andused

Important dimensions include:

T&D automation to enhance operational efficiency and reduce cost

AMI + demand response to optimize energy usage

Promote RE and EE to reduce carbon emissions


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Why are efficient electricity networks important?


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Electricity is the premium form of end-use energy

Electricity is the premium energy source for an increasingly digital world

Growth in demand for electricity is unrelenting

Population growth and increasing affluence feed demand for reliable powerElectricity is the fastest growing form of end-use energy

Non-OECD countries will use 58% of world energy by 2030

US energy needs met by electricity grew from 20% in 1960 to 40% in 2000

This is a harbinger of the global future

Source: US Energy Information Administration, International Energy Outlook,2009


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Indias power sector has added challenges

Supply shortfalls

Peak load management issues

Higher technical and commercial lossesIncreasing global competition for resources

Challenges for Jodhpur Power Utility

High Solar potential

Higher technical and commercial lossesAbout 40% agriculture consumption with no economic incentive to useefficiently

Dispersed Geographical area


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The power sector is also one of the biggest carbon emitters

Indias installed thermal power generation capacity represents 60% of net generationcapacity and 57% of greenhouse gas emissions

Based on current plans, this scenario will likely continue until 2020

Thus, the national goal to install 20,000 MW of solar powerby 2020

Wind and other renewables are growing rapidly too

Smart Grids are needed to enable grid management tocope with the unique dispatchability characteristics

of renewable energy sources


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An historic convergence is reshaping the electric business

Relentless growth in electricity demand as the premiumform of energy

Demand for higher quality by more discerning andaffluent customers

Meanwhile, technological advances in information and communications technology(ICT), metering and generationare key enablers

Continued reductions in the cost of technology vastlyexpands its scope

The climate change crisis is driving the need for an urgent reduction in carbon emissions and thus a much moreefficient power sector

The traditional business model is troubled and implementationof a Smart Grid vision may facilitate a reinvention of the business


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What, exactly, is a Smart Grid?


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The Smart Grid is a vision more than a blueprint

The Smart Grid cant be reducedto a simple formula.

The broadest interpretation sees theelectric industry transformed by theintroduction of two-way communicationsand ubiquitous metering and measurement.

It will enable creation of more reliable,more efficient and more secure electricalinfrastructure

Key characteristics of the smart grid

Self-healing: The grid rapidly detects, analyzes, responds,and restores

Empowers and incorporates the consumer: Ability toincorporate consumer equipment and behavior in griddesign and operation

Tolerant of attack: The grid mitigates and is resilient tophysical / cyber-attacks

Provides power quality needed by 21st-century users: Thegrid provides quality power consistent with consumer andindustry needs

Accommodates a wide variety of supply and demand: Thegrid accommodates a variety of resources, includingdemand response, combined heat and power, wind,photovoltaics, and end-use efficiency

Fully enables and is supported by competitive electricity

markets.

Robert Galvin and Kurt Yeager, Perfect Power, McGraw Hill, 2009, p. 82.


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The Smart Grid environment spans the electricity value chain

Source

Generation Dispatch, AREVA IEEE Smart Grid Conference January 2010.


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Advanced technologies will make smart grids possible

Meters

Storage devices

Distributed generationRenewable energy

Energy efficiency

Home area networks

Demand response

IT and back office computing

Security

Integrated communications systems

Superconductive transmission lines


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Technology enables improvements in many areas

Phasor Measurement

Unit

Demand response

Capacitor control

Islanding

Time-of-use tariffs

Distributed, standbyand off-gridgeneration

Renewable energy

DSM and LM

Mini-SCADA

Outage monitoring

and evaluation

Remotedisconnection andreconnection

Automated meterreading

CRM applicable

Increase

electricitysupply

Reduce

commerciallosses

Reduce

operating costsReliabilityAvailability


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But where does the customer fit in?

ARC + GCR = QCS is the formula for Quality Customer Service [Availability, Reliability,Cost + Good Customer Relations]

For many, the as-delivered service may feel like ARC + GCR

Much of the Smart Grid is focused on other results, e.g.

Reducing carbon emissions

Improving the efficiency of the networks

Promoting renewable energy and energy efficiency

Enhancing security of supply

But customer uptake will be critical to achieving full benefits


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Customer response is a critical success factor for SmartGrids

Customers want utilities to produce benefits, including

Reduced Monthly Electricity Bill

Reduced outagesIncreased control over energy consumption and cost via better data on usage and usagepatterns (like telcoms)

More choices for energy sources

Options to supply energy to the grid

Green choices to increase environmental sustainability

The price differential between peak power vs. solar and diesel generation alternativesis shrinking


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Kitna hai? How Much?What are the cost-benefit analysis issues?


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Smart Grid cost-benefit analysis warrantsa broad-gauged approach

It should incorporate societal benefits and externalities as well as the costs and benefitsof conventional investment proposals.

This will require a delicate balance, but the transformational potential of the smart grid

vision warrants it.

A reduction in carbon emissions will improve public health.

Some smart grid projects will create employment, enhance agricultural security,stimulate economic growth or provide other benefits that are outside the boundaries of

conventional projects.

These should be taken into account.

Such benefits are difficult to measure, but that shouldnt deter policy makers andregulators from devising a methodology.


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Potential benefits

Peak load reduction. TOD price signals has unique potential for India.

AT& C loss reduction. This is a major commercial and regulatory consideration. Discoms

may consider communication technology.

Self-healing. A smart grid automatically detects and responds to routine problems andquickly recovers, minimizing downtime and financial loss.

Consumer motivation. Smart grids give consumers visibility into pricing offers anopportunity to control usage

Attack resistance. Smart grids have security built-in from the ground up.

Improved power quality. A smart grid helps provide power free of sags, spikes,disturbances and interruptions.

Accommodation of all generation and storage options. Enables interconnection to

distributed sources of power and storageEnabled markets. Supports investment and innovation.

Optimized assets and operating efficiently. Lowers need for construction of newinfrastructure and enables sale of more power through existing system.


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Risk factors

The Impact of a Smart Grid projects scale and complexity Uncertainties create afinancial risk that actual benefits from a smart meter plan may prove to be less than the

stated projections.The Systems Integration Effect The costs and benefits of a partial, stand aloneSmart Grid implementation might be notably less attractive than the costs and benefits of

a broader, holistic program.

Accelerated depreciation of technology The technological and cost curves for

computers are very different from the equipment historically used in the electric industry.If advanced metering systems exhibit technological and cost behaviors similar to those ofcomputers, their useful lives may turn out to be shorter than estimated.

Risk of stranded assets This could involve equipment that was, at the point ofinstallation, state-of-the art but before it reached the end of its useful life it was eclipsedby newer technology costing much less.


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Whats the way forward?


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Connecting the smart grid dotsTM framework

Connecting the smart grid dots framework is trade marked by PA Consulting


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You may need to rebuild the ship, but you cant stop sailing

There is much unfinished business to be taken care of before adopting advanced smartgrid features on a broad scale, but action should not be delayed.

Transitioning to a smart grid vision tailored to Indias unique circumstances wouldinclude:

Develop a national vision and a flexible plan to pursue smart grid benefits

Build on R-APDRP and link service quality improvements to measurable KPIs

Develop smart grid pilots to reinforce operational efficiency at discoms Conduct customer and marketing surveys to refine the understanding of what drives

customer satisfaction

Craft policies and regulations to create a more receptive environment for smart gridsby encouraging innovation, establishing interoperability standards, and allowing moremarket-oriented and entrepreneurial solutions.

Implement techno-commercial proof of concept pilot projects for initiatives that havepotentially high impacts, including those that can be implemented independently ofthe grid.


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Whats the next move?


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Overall, the major elements include:

Developing a smart grid vision

Conducting appropriate communication to educate and develop consensus

Identifying viable funding options

Implementing appropriate policy and regulatory actions to set common standards andencourage innovation.

In tandem with these actions, certain techno-commercial pilot projects could be

implemented to demonstrate their commercial viability. A high-level view of the nextsteps is presented in the following table.


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Smart grid focus areas for Jodhpur power utility

High potential impact Contributing impact Enabling precondition

8.Direct debit delivery of subsidiescoupledwith cost-based tariffs

7. Advanced Volt/VAR support

6. TOU rate pilot project

5. Distributed RE generation in

remote rural villages

4. Off-grid renewable energy for

irrigation pumping

3. Replacement of small- scale

gensets with renewable energy

2. Smart green apartment complex

1. Link R-APDRP to measurable

servicequality KPIs

Transformthe BizModel /

AccelerateReform

ReduceDemand on

Discoms

FacilitateDemand

Response

and EnergyEfficiency

Improve

ServiceQuality /Enhance

Transparency

Reduce /MitigateCarbon

Emissions

ReduceAT&C

Losses /Improve

EfficiencyPossible Pilot Project/Study


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The initial capital cost could be significant

Installation and O&M costs are unknown.

Reliable electricity for irrigation pumping

Enhanced control of ability to irrigate crops for farmers

Improved agricultural outcomes, i.e., crop quality,farmer incomes

Reduction in power sector subsidies

CostsBenefits

A intensive program to educate farmers will likely be required

Regulatory approval and assent by a discom may be required if an ESCO (with a contractwith the local discom) will own the RE source

Vested interests who get free electricity under Ag tariffs may oppose something thatreduces the known benefit they now receive

The economic viability of the program might require metering and possibly a cost-recovermechanism, e.g., tariff.

Analyze EA03 and state regulations to identify preconditions

Survey RE and high-efficiency pump manufacturers to identify the technologyoptions and estimated costs

Study the results of Ag DSM pumping pilotsand franchise pilots

Develop an economic model, evaluate costs and benefits,and assess funding options

Plan demonstration pilots for several regionswith different RE.

Key Challenges and QuestionsImplementation Approach

Many of Indias 10,000,000 irrigation pumps are powered by electricity that is provided free or at a nominal tariff. These dysfunctional but politically correct tariffs have caused thewasteful use of water and electricity. Underground aquifers are being depleted at an ever-increasing rate and estimates of electricity used for irrigation pumping range from 20 to30% of total. Distributed renewable energy (e.g., wind, solar) could be used to provide power to operate pumps that could irrigate fields directly or pump water to storage tanks forlater use or, alternatively, energize batteries. A one-time capital grant to offset the installation cost of such a system might be justified in terms of the value of subsidies to thepower sector that could be discontinued. This could be integrated as part of an ESCO Agricultural DSM solution as is being tested at Doddaballapur, Karnataka or with othermodels considered (e.g., farmer cooperative), including the franchise model to improve the economic viability of franchises with significant agricultural demand.

Business Case

Off-Grid Renewable Energy for Irrigation Pumping


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The secret to survival is to embrace change and to adapt- Rohinton Mistry, A Fine Balance

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The Smart Grid Vision for Jodhpur Power Utility